No Stability In Kitchen Market

Kitchen market remains volatile, No respite for a while. Big farm and cooperative Could give a sigh of relief.

In a bid to stabilize the egg market, govt decided to import 40 million pieces of egg from neighboring India. The amount is equivalent to one-day worth of egg demand. Despite a slight reduction in price at the wholesale level for purchase of larger quantities, there is hardly any change at the retail level. But the policy makers are optimistic that the decision would somehow stabilize the egg market. I recently came across a news report that claimed chick prices increased by 10 taka following the decision of importing Indian egg. Now this will definitely have impact at the retail level when chicken will reach to consumption-level stage unless feed prices witness a dramatic cut.

Hatchers and breeders keep blaming the ongoing war and mercurial nature of taka against the dollar.

Not only the poultry market, potato prices show unprecedented level of volatility that ordinary people never anticipated. Being one of the cheapest vegetables (being sold at taka 20/KG three months ago),sky rocketing price of potato(at one point it reached taka 60/KG) led the govt to intervene. Govt fixed the price at taka 27/KG for cold storage and taka 35/KG for the retail sale. However, the decision has yet to be translated at the grass root level. Some cold storages even stopped selling potato at the set prices and asked govt to review its price.

In recent months, both Japan and Russia have shown keen interest to purchase Bangladeshi potatoes. It may play some role in prompting some quarter to hoard potatoes. National election and local govt election after the national election also casts shadow over the kitchen market. As less or no documentation required in kitchen market, it has become a mean to bleach opaque capital. It is worth to mention that pisciculture is one of the popular sources of income mentioned by candidates aspire to run for MP and local govt election. It is highly likely that some quarter may exploit the kitchen market to finance electoral campaigns. Otherwise, volatility in prices of too many items is highly unusual at this time of the year. In international market,prices of major commodities are coming down.

I think government should introduce corporate bond here like India to make electoral contributions to public representatives. Though such bond is criticized by press and others for being a source of money laundering, it could at least keep at bay opaque capital from entering the kitchen market. In this mechanism, corporate groups purchase bonds from the central bank, which never asks origin of the money. Later corporate groups donate the bonds to parties/candidates aspire to run for election. They deposit the bonds to central bank and encash it.

Another way is to introduce documentation in kitchen market and to ask origin of money invested in the business.

Government has some role to play here. As I have argued earlier, government could set up hatcheries, feed mill and cold storage across the country to furnish chicks,feed and kitchen items at tolerable prices, curbing oligopolistic power of the farms. If government can intervene in telecommunications market,it can do the same here. Encouraging agricultural cooperatives like MilkVita to increase their presence in cities like Dhaka also make redundant the middlemen. Unlike middlemen, govt could track cooperative and big farm and implement any policy change.